Netanyahu Backs Down in U.S.-Israel Military Aid Deal

After staking out a hardline stance over a new arms package, Israel swallowed concessions in return for a 10-year U.S. commitment.

WASHINGTON, DC - NOVEMBER 9: (AFP OUT) U.S President Barack Obama (R) speaks as he meets with Israeli Prime Minister Benjamin Netanyahu in the Oval Office of the White House November 9, 2015 in Washington, DC. This is President Obama and Israeli Prime Minister Netanyahu first meeting since relations deteriorated over a nuclear deal between world powers and Iran. (Photo by Olivier Douliery-Pool/Getty Images)

Israel drove a hard bargain for months in negotiations with the United States over the terms of a new military aid deal, pushing for more funding and other concessions. But in the end, Prime Minister Benjamin Netanyahu backed off.

The two governments announced Tuesday they had wrapped up a new memorandum of understanding that will deliver an unprecedented $38 billion worth of arms to Israel over the next decade in what the State Department called the “single largest pledge of bilateral military assistance in U.S. history.” The package does not detail what military hardware Israel will acquire or when, but amounts to a nearly $40 billion gift card at the Pentagon’s weapon bazaar.

But when President Barack Obama first put the groundbreaking offer on the table last year, Netanyahu refused to enter into negotiations on grounds that it would signal his support for the Iran nuclear agreement, which he bitterly opposes.

Even after talks eventually got underway on a new memorandum, Netanyahu’s government pushed for a larger figure than the one proposed by Washington, a position that sparked deep frustration in the White House. Israel also initially opposed provisions that would require them to refrain from lobbying Congress for more missile defense money beyond what is promised in the MOU. And it also argued against a U.S. proposal to phase out an arrangement that had set aside 26 percent of the earmarked funds for the Israeli defense industry.

But those objections gradually faded, and the massive military aid package was hammered out after 10-months of negotiations despite the very publicly strained relationship between Netanyahu and Obama.

It’s not clear why Netanyahu’s stance changed over the past several months, as the Obama administration basically stayed pat, according to current and former U.S. officials. Israel apparently concluded that it would not be able to secure a better deal than the one on offer, and the Israeli military was anxious not to lose any more time re-negotiating the deal with a new U.S. administration after the presidential election in November.

The MOU, which is due to be signed in a ceremony at the State Department on Wednesday, also could pave the way for a long-delayed sale of U.S. fighter jets to Qatar and Kuwait. The White House has been weighing those possible deals for more than two years amid concerns over Qatar’s links with Islamist militants as well as Israel’s relative military strength compared to its Arab neighbors.

Those potential deals, worth several billion dollars, would deliver up to 72 F-15E Strike Eagle fighter jets to Qatar and 28 F/A-18 Hornets to Kuwait, both of which would be a boon to aerospace giant Boeing.